Activist Melissa Sehgal, of Sea Shepherd's Cove Guardians, said in a livestream from the scene that 52 of the dolphins were separated to be trained for marine park work, but many of the remaining dolphins were killed for their meat.

Ms Sehgal described the scene as dozens of dolphins were herded or dragged into the tent, later to emerge stacked on skiffs for transfer to the town's butcher house.

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Fishermen in wetsuits hunt dolphins at a cove in Taiji, Japan, on Tuesday.Credit:Reuters

The processing, which began last weekend had been horrific to witness, she said.

One group of dolphins had been left alive, potentially to be driven out to sea again.

"We can't say for sure until we see them being driven out," Ms Sehgal said. "But we're trying to remain hopeful."

A renewed spotlight fell on the long-standing hunt when US ambassador to Japan Caroline Kennedy said she was deeply concerned at the inhumaneness of drive hunt dolphin killing.

A scene from the documentary The Cove.

British ambassador to Japan Tim Hitchens joined condemnation of the hunts which he said caused terrible suffering.

Andrew Darby is the Hobart correspondent for Fairfax Media. His focus is on Australia's interests south of 40 Degrees South - Tasmania, the Southern Ocean and Antarctica. He is the author of the internationally published Harpoon: Into the Heart of Whaling